Cherry Grove business sues North Myrtle Beach for ‘unconstitutional’ beach ordinance | Myrtle Beach News
NORTH MYRTLE BEACH — The city of North Myrtle Beach was recently served its second federal lawsuit in less than a week, this time by a Cherry Grove business alleging an ordinance amendment recently passed by City Council is unconstitutional.
Cherry Grove Beach Gear, a beach accessory rental company, claims in a 20-page lawsuit filed on July 11 that North Myrtle Beach officials “unlawfully” targeted the business through a June 29 ordinance amendment and additionally sought to place a monopoly on the rentals of beach chairs and umbrellas on the city’s 9-mile shoreline.
The court filing comes six days after the American Civil Liberties Union of South Carolina filed a separate federal lawsuit on July 5 against North Myrtle Beach and two of its officials alleging an amendment to the city’s existing noise ordinance that passed last year targeting “vulgar” music is unconstitutional.
North Myrtle Beach said its policy is to not comment on pending litigation.
City Council amended an existing ordinance on June 29 that prohibits businesses or people, regardless of the time, from renting, setting up or delivering any beach equipment from public beaches in the city. However, business owners can make arrangements to deliver the items to homes, rental units or at the end of beach accesses.
City officials previously said the ordinance that prohibits private companies from doing business on the beach is decades old. City Council passed an ordinance in 1990 that “prohibits any person from engaging in the sale, lease or rent of any goods or other property upon the public beaches unless he or she has been granted a franchise.”
The lawsuit claims city officials never intended to grant a franchise agreement with a third-party vendor and the prior ordinance was a “sham” designed to restrict competitive businesses, as well as “monopolize” the city’s current service of renting its own chairs and umbrellas.
Additionally, it alleges that North Myrtle Beach earns nearly $3 million annually off beach rentals but has “not collected and remitted sales and use taxes and accommodations taxes.”
Cherry Grove Beach Gear said in the lawsuit that it has operated legally within the city limits since 2019 with a valid business license while paying both local accommodations and hospitality taxes imposed by City Council. According to the lawsuit, officials allegedly had no issues with the owners setting up rentals on the beach; their only concern was the safety of the company putting up umbrellas.
The owners claim that the city of North Myrtle Beach violated state law by mishandling accommodations and hospitality taxes by “comingling” the revenue with the city’s general fund, the lawsuit said.
Derek Calhoun, who owns Cherry Grove Beach Gear, said he has received fines from the city totaling $5,000 for setting up his gear on the beach, according to a recent social media post.
The lawsuit said the daily citations are factors City Council could use to revoke Cherry Grove Beach Gear’s business license, thereby putting them out of business.
“If (the city’s) illegal and wrongful decision to target (Cherry Grove Beach Gear) and adopt North Myrtle Beach City Ordinance 5-24 is not reversed, (the city’s) actions will have resulted in a permanent taking of (Cherry Grove Beach Gear) and a substantial loss of the owners’ investments,” the lawsuit said.
The lawsuit asks for a temporary injunction against the city of North Myrtle Beach and an undisclosed monetary amount for damages.
